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          (b) Affiliate and Associate. “Affiliate” and “Associate” shall have the respective meaningsascribed to such terms in Rule 12b-2 under the Exchange Act, in effect on the date of thisAgreement.          (c) Cause. For “Cause” shall mean that, during the Term, the Executive shall have:          (i) committed an intentional material act of fraud or embezzlement in connection withhis duties or in the course of his employment with the Company;          (ii) caused by intentional act or omission material damage to property of the Company;          (iii) committed an intentional wrongful disclosure of material secret processes ormaterial confidential information of the Company; or          (iv) been convicted of a felony criminal offense.For the purposes of this Agreement, no act, or failure to act, on the part of the Executive shallbe deemed “intentional” unless done, or omitted to be done, by the Executive in bad faith or withno reasonable belief that his act or omission was in the best interests of the Company.          (d) Change in Control. A “Change in Control” of the Company shall have occurred if at any timeduring the Term of this Agreement any of the following events shall have been consummated:          (i) any consolidation, merger or other reorganization of the Company in which theCompany is merged, consolidated or reorganized into or with another corporation or otherlegal person or pursuant to which shares of the Company’s stock are converted into cash,securities or other property, other than (A) a consolidation, merger or other reorganizationof the Company in which the holders of the Company’s Common Stock immediately prior to themerger own more than 50.1 % of the common stock (or such other securities that may cast avote for the election of directors of the entity) of the surviving entity or its ultimateparent immediately after the merger or (B) a consolidation, merger or reorganization of theCompany as a result of which no person (as defined in Section 2(d)(iv)) becomes an AcquiringPerson;          (ii) any sale, lease, exchange or other transfer (in one transaction or a series ofrelated transactions) of all or substantially all of the assets of the Company, and as aresult of such transaction the holders of the Company’s Common Stock immediately priorthereto own less than 50.1 % of the common stock (or such other securities that may cast avote for the election of directors of the entity) of such transferee or its ultimate parentimmediately after such transaction;          (iii) any liquidation or dissolution of the Company or any approval by the stockholdersof the Company of any plan or proposal for the liquidation or dissolution of the Company;
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          (iv) any person (including any “person” as such term is used in Section 13(d)(3) orSection 14(d)(2) of the Exchange Act) has become an Acquiring Person;          (v) if at any time the Continuing Directors then serving on the Board cease for anyreason to constitute at least a majority thereof; or          (vi) any occurrence that would be required to be reported in response to Item 6( e) ofSchedule 14A of Regulation 14A under the Exchange Act, or any successor rule or regulation.provided, however, that a Change in Control of the Company shall not be deemed to have occurred asthe result of any transaction having one or more of the effects specified in clauses (i)-(vi) aboveif such transaction is proposed by, and includes a significant equity participation (i.e., anaggregate of at least 25% of the outstanding common equity securities of the Company immediatelyafter such transaction which are entitled to vote to elect any class of Directors) of, theexecutive officers of the Company as constituted immediately prior to the occurrence of suchtransaction or any Company employee stock ownership plan or pension plan.          (e) Code. The “Code” shall mean the Internal Revenue Code of 1986, as amended.          (f) Continuing Director. A “Continuing Director” shall mean a director serving on the Boardwho (i) is not an Acquiring Person, an Affiliate or Associate of an Acquiring Person, arepresentative of an Acquiring Person or a person who was nominated for election by an AcquiringPerson, and (ii) was either a member of the Board on the date of this Agreement or subsequentlybecame a Director of the Company and whose initial election or initial nomination for election bythe Company’s stockholders was approved by at least two-thirds of the Continuing Directors then onthe Board but shall not include, in any event, any individual whose initial assumption of officeoccurs as a result of either an actual or threatened election or other action or threatenedsolicitation of proxies or consents by or on behalf of a person other than the Board.          (g) Exchange Act. “Exchange Act” shall mean the Securities Exchange Act of 1934, as amended.          (h) Severance Compensation. The “Severance Compensation” shall be a lump sum amount equal to:(i) one times the Executive’s annual salary plus (ii) one times the Executive’s potential bonus orincentive compensation, as communicated by or at the direction of the Chief Executive Officer, ineffect as of the date of a Change in Control.          (i) Term. The “Term” shall have the meaning specified in Section 1.          (j) Termination Date. The “Termination Date” shall be the date upon which the Executive or theCompany terminates the employment of the Executive.
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     3. Rights of Executive Following a Change in Control.          (a) The Company shall provide the Executive, within 10 business days following the applicableTermination Date (but in any event by March 15 of the year following such Termination Date),Severance Compensation in lieu of compensation to the Executive for periods subsequent to theTermination Date, but without affecting any other rights of the Executive at law or in equity, ifany of the following events occur:          (i) the Company terminates the Executive’s employment within two years after a Changein Control that occurs during the Term, other than for either of the following reasons:          (A) the Executive becomes permanently disabled and is unable to work for aperiod of 180 consecutive days (a “Disability”); or          (B) for Cause;          (ii) the Executive terminates his employment during the Term, but after a Change inControl, by providing written notice to the Company (which shall indicate the specifictermination provision in this Agreement relied upon and shall set forth in reasonable detailthe facts and circumstances claimed to provide a basis for such termination) within sixty(60) days after the Executive’s base salary is decreased by twenty (20) percent or morewithin two years after a Change in Control that occurs during the Term. Notwithstanding theforegoing, in the event that the Executive provides such notice of his termination ofemployment, the Company shall have a period of 30 days in which to remedy the condition.          (b) Continued Benefits. If any of the events specified in Sections 3(a)(i) or (ii) occurs andExecutive is entitled to Severance Compensation, then until the earlier of the second anniversaryof the Termination Date or the date on which the Executive becomes employed by a new employer, theCompany shall, at its expense, provide the Executive with medical, dental, life insurance,disability, accidental death and dismemberment benefits and other welfare benefits (“InsuranceBenefits”) at the highest level provided to the Executive immediately prior to the Change inControl, provided, however, that if the Executive becomes employed by a new employer whichmaintains Insurance Benefits that either (i) do not cover the Executive with respect to apre-existing condition which was covered under the Company’s Insurance Benefits, or (ii) do notcover the Executive for a designated waiting period, the Executive’s coverage under the Company’sInsurance Benefits shall continue, without limitation, until the earlier of the end of theapplicable period of non coverage under the new employer’s Insurance Benefits or the secondanniversary of the Termination Date.          (c) Outplacement Counseling. If any of the events specified in Section 3(a)(i) or (ii) occursand Executive is entitled to Severance Compensation, the Company shall reimburse all reasonableexpenses for professional outplacement services by qualified consultants selected by the Executive,in an amount not to exceed $50,000.00; provided, however, that the reimbursement of such expensesis limited to expenses incurred on or before the last day of the second year following the year inwhich the termination of the Executive’s employment takes
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place and payment shall be made on or before the last day of the second year following the year inwhich such termination takes place.          (d) Payment of Earned But Unpaid Amounts. Within 10 business days after any of the eventsspecified in Sections 3(a)(i) or (ii) has occurred, the Company shall pay the Executive any earnedbut unpaid portion of his salary, bonus or incentive compensation or other compensation.          (e) Other Rights and Benefits. The payment of Severance Compensation by the Company to theExecutive shall not affect any other rights and benefits of the Executive provided by the Company,prior to the Termination Date, which rights shall be governed by the terms of the agreementsgoverning such rights or benefits.          (f) No Set-Off or Counterclaim. Except as otherwise specifically provided herein, the Companyshall have no right of set-off or counterclaim in respect of any claim, debt or obligation againstany payment or benefit to or for the benefit of the Executive provided for in this Agreement.          (g) Interest on Payments. Without limiting the rights of the Executive at law or in equity, ifthe Company fails to make any payment required to be made hereunder on a timely basis, the Companyshall pay interest on the amount thereof on demand at an annualized rate of interest equal to thePrime Rate as reported in the Money Rates section of The Wall Street Journal (or in the successorto such section or, if there is no such successor section, the most comparable Prime Rate),compounded daily (but in no event shall such interest exceed the highest lawful rate).          (h) Vesting of Stock Awards. If any of the events specified in Sections 3(a)(i) or (ii) occurand the Executive is entitled to Severance Compensation hereunder then on the Termination Date, allstock option grants, awards of restricted stock or restricted stock units, and all other forms ofstock awards previously granted to the Executive shall vest immediately (as if his employment werenot terminated) and be non-forfeitable.          (i) Code Section 409A. If the Company determines in good faith that any payment hereunderwould cause a violation of Code Section 409A if paid within the first six (6) months aftertermination of Executive’s employment, such amount(s) shall not be paid during such six (6) monthperiod but shall instead be paid in a lump sum (without interest) immediately after the end of suchsix (6) month period and such payment shall be considered to be made on a timely basis for purposesof this Agreement. In the event that continuation of any benefit would in the good faith judgmentof the Company cause a violation of Code Section 409A if provided at Company cost during the firstsix (6) months after the Termination Date, if Executive desires such benefit continuation, he shallpay to the Company the full cost therefor during such six (6) month period and the Company shallreimburse him for such cost (without interest) in a lump sum payment immediately after or end ofsuch six (6) month period.     4. Gross-up.          (a) If it is determined that any payment, benefit or distribution (or combination thereof) bythe Company, or by any trust established by the Company for the
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benefit of its employees or by a person whose actions result in a change of ownership or effectivecontrol covered by Section 280G(b)(2) or any person affiliated with the Company or such person, toor for the benefit of the Executive (whether payable pursuant to the terms of this Agreement orotherwise (a “Payment”)) would be subject to the excise tax imposed by Section 4999 of the Code, orany successor provision, and any interest or penalties are incurred by the Executive with respectto such excise tax (the excise tax, together with interest and penalties thereon, hereinaftercollectively referred to as the “Excise Tax”), the Executive shall be entitled to receive anadditional payment (a “Gross-up Payment”) in an amount such that after payment by the Executive ofall taxes, including, without limitation, any income taxes and the Excise Tax imposed upon theGross-up Payment (and any interest or penalties), the Executive shall retain an amount of theGross-up Payment equal to the sum of (i) the amount of the Excise Tax imposed upon the Payment orthe Gross-up Payment and (ii) without duplication, an amount equal to the product of (1) anydeductions disallowed for federal, state or local income tax purposes because of the inclusion ofthe Gross-up Payment in the Executive’s adjusted gross income, and (2) the highest applicablemarginal rate of federal, state or local income taxation, respectively, for the calendar year inwhich the Gross-up Payment is made or is to be made. The intent of this Section 4 is that theExecutive, after paying his federal, state and local income taxes and payroll taxes, will be in thesame position as if he was not subject to the Excise Tax and did not receive the extra amountspursuant to this Section 4. Notwithstanding the foregoing provisions of this Section 4(a), if itshall be determined that the Executive would otherwise be entitled to a Gross-up Payment, but thatthe Payments do not exceed one hundred ten percent (110%) of the greatest amount (the “ReducedAmount”) that could be paid to the Executive such that the receipt of Payments would not give riseto any Excise Tax, then no Gross-up Payment shall be made to the Executive and the Payments, in theaggregate, shall be reduced to the Reduced Amount.          (b) Subject to the provisions of Section 4(c), all determinations required to be made underthis Section 4, including whether and when a Gross-up Payment is required and the amount of suchGross-up Payment and the assumptions to be utilized in arriving at such determination, shall bemade by such nationally recognized certified public accounting firm or law firm as may bedesignated by the Executive (the “Firm”). All fees and expenses of the Firm shall be borne solelyby the Company. Any Gross-up Payment, as determined pursuant to this Section 4, shall be paid bythe Company to the Executive within five days after the receipt of the Firm’s determination. If theFirm determines that no Excise Tax is payable by the Executive, it shall so indicate to theExecutive in writing. Any determination by the Firm shall be binding upon the Company and theExecutive.          (c) The Executive shall notify the Company in writing of any claim by the Internal RevenueService that, if successful, would require the payment by the Company of a Gross-up Payment. Suchnotification shall be given no later than 10 business days after the Executive is informed inwriting of such claim and shall apprise the Company of the nature of the claim and the date ofrequested payment. The Executive shall not pay the claim prior to the expiration of the 30-dayperiod following the date on which it gives notice to the Company. If the Company notifies theExecutive in writing prior to the expiration of the period that it desires to contest such claim,the Executive shall:          (i) give the Company any information reasonably requested by the Company relating tosuch claim;
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          (ii) take such action in connection with contesting such claim as the Company shallreasonably request in writing from time to time, including, without limitation, acceptinglegal representation with respect to such claim by an attorney reasonably selected by theCompany;          (iii) cooperate with the Company in good faith in order to effectively contest suchclaim; and          (iv) permit the Company to participate in any proceedings relating to such claim.Without limitation on the foregoing provisions of this Section 4(c), the Company shall control allproceedings taken in connection with such contest and, at its sole option, may pursue or forego anyand all administrative appeals, proceedings, hearings and conferences with the taxing authority inrespect of such claim and may, at its sole option, either direct the Executive to pay the taxclaimed and sue for a refund or contest the claim in any permissible manner, and the Executiveagrees to prosecute such contest to a determination before any administrative tribunal, in a courtof initial jurisdiction and in one or more appellate courts as the Company shall direct, provided,however, that the Company shall bear and pay directly all costs and expenses (including additionalinterest and penalties) incurred in connection with such contest and shall indemnify and hold theExecutive harmless, on an after-tax basis, for any Excise Tax or income tax (including interest andpenalties with respect thereto) imposed as a result of the contest; and provided further, that ifthe Company directs the Executive to pay any claim and sue for a refund, the Company shall advancethe amount of the payment to the Executive, on an interest-free basis, and shall indemnify and holdthe Executive harmless, on an after-tax basis, from any Excise Tax or income tax (includinginterest or penalties with respect thereto) imposed with respect to the advance or with respect toany imputed income with respect to the advance.          (d) If the Company exhausts its remedies pursuant to Section 4(c) and the Executive thereafteris required to make a payment of any Excise Tax, the Firm shall determine the amount of theGross-up Payment required, and such payment shall be promptly paid by the Company to or for thebenefit of the Executive.          (e) If, after the receipt by the Executive of an amount advanced by the Company pursuant toSection 4(c), the Executive becomes entitled to receive any refund with respect to such claim, theExecutive shall promptly pay to the Company the amount of such refund (together with any interestpaid or credited thereon after taxes applicable thereto). If, after the receipt by the Executive ofan amount advanced by the Company pursuant to Section 4(c), a determination is made that theExecutive is not entitled to any refund withrespect to such claim, and the Company does not notify the Executive in writing of its intentto contest such denial of refund within 30 days after such determination, then such advance shallbe forgiven and shall not be required to be repaid and the amount of such advance shall offset, tothe extent thereof, the amount of the Gross-up Payment required to be paid.          (f) Notwithstanding any provision of this Agreement to the contrary, the reimbursement of anyexcise taxes imposed under Section 4999 of the Code shall take place by the end of the yearfollowing the year in which such taxes are remitted.
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     5. No Mitigation Required. In the event that this Agreement or the employment of the Executiveis terminated, the Executive shall not be obligated to mitigate his damages or the amount of anypayment provided for in this Agreement by seeking other employment or otherwise, and except for thetermination of benefits pursuant to Section 3(b), the acceptance of employment elsewhere aftertermination shall in no way reduce the amount of Severance Compensation payable hereunder.     6. Successors; Binding Agreement.          (a) The Company will require any successor and any corporation or other legal person(including any “person” as defined in